In the years leading up to the global financial crisis (say, around 2005-06), the large U.S. federal government deficits have not led to high long-term interest rates (unlike in the 1980s). Which of the followings may not be a possible explanation? a. global saving glut (in excess of global investment). b. foreign exchange intervention by central banks in East Asia (i.e., purchases of US Tbonds) as part of their efforts to promote the exports via keeping their currencies undervalued (or at least preventing their currencies from appreciating). c. Saving surpluses of oil exporters, such as Saudi Arabia. d. strong stock market rebound. e. None of the above.
In the years leading up to the global financial crisis (say, around 2005-06), the large U.S. federal government deficits have not led to high long-term interest rates (unlike in the 1980s). Which of the followings may not be a possible explanation? a. global saving glut (in excess of global investment). b. foreign exchange intervention by central banks in East Asia (i.e., purchases of US Tbonds) as part of their efforts to promote the exports via keeping their currencies undervalued (or at least preventing their currencies from appreciating). c. Saving surpluses of oil exporters, such as Saudi Arabia. d. strong stock market rebound. e. None of the above.
Chapter1: Making Economics Decisions
Section: Chapter Questions
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In the years leading up to the global financial crisis (say, around 2005-06), the large U.S.
federal government deficits have not led to high long-term interest rates (unlike in the 1980s).
Which of the followings may not be a possible explanation?
a. global saving glut (in excess of global investment).
b. foreign exchange intervention by central banks in East Asia (i.e., purchases of US Tbonds) as part of their efforts to promote the exports via keeping their currencies
undervalued (or at least preventing their currencies from appreciating).
c. Saving surpluses of oil exporters, such as Saudi Arabia.
d. strong stock market rebound.
e. None of the above.
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